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Assessing a Major Capital Equipment Initiative for an Academic Medical Center
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Assessing a Major Capital Equipment Initiative for an Academic Medical Center

Client/Profile

A nationally-known academic medical center

Challenge/Situation

To help the client make a decision about the purchase and operation of a proton beam accelerator for tens of millions of dollars. The high investment requirements had to be evaluated in the context of the organization’s commitment to clinical and research leadership.

Process

Getting the latest technology is often presented as an imperative for a leading institution. Our analysis was designed to bring the uncertainty surrounding the decision to an acceptable level through a thoughtful and structured process. This allowed the institution to evaluate the likely financial realities in the context of its need to maintain its clinical and research leadership position.

Because the initiative would have a long lead time, we assessed the direction and pace of technological development to assure that it would still be state-of-the-art when completed.

We evaluated the financial implications of using each of several different equipment vendors and financing mechanisms. We modeled the implications of specific hospital partners in the initiative. This allowed the hospital to compare its options objectively. Veralon engaged a range of internal constituencies in the discussions, including clinical and research leaders, administration and the Board.

Results

We concluded that, given its situation, the hospital should not purchase the equipment at this time, but should treat patients at another facility through an affiliation. When technology and reimbursement questions settle, the client will reconsider acquisition.